A Non-partisan Political Commentary for Those Who Prefer To Think for Themselves

Sunday, August 17, 2008

The Changing Face of America

English speaking whites are fast becoming a minority. So, what’s new about that? Everyone knows that the face of America is changing. Just take a look (or listen) the next time you go shopping. Whites are already a minority in several large US cities. Businesses are busy making the switch over to Spanish as part of their regular consumer vocabulary. Women in burkas seem almost common place at bus stops or at the grocery store. It seems that there are more Hindu, Buddhist, and Moslem places to worship than ever before. What’s behind this trend? Are we just that becoming more conditioned to be on the look out for these changes, or are they real?

Changes in national demographics aren’t anything new. It has been happening since the beginning of civilization. Originally, it was probably someone from one tribe marrying into another tribe. Later, it was one nation or City-state invading another. As it happens, national identities often change with it. Today’s Italians, Greeks, Iranians, Iraqis, Syrians, Egyptians, and Turks bear little resemblance to their illustrious ancestors in appearance, language or religion. So, just what is happening to America?

According to the US Census Bureau, there are some 305 million people living in America right now. That is expected to increase to 439 million by 2050. Non-Hispanic whites currently make up 75% of the population. The white population is rapidly aging (baby boomers tended to have few children of their own and thus there are fewer white children to replace them). By 2030, there will be 79 million Americans 65 years old or older.

This means that by 2042, a mere 34 years from now, whites will make up a projected 47% of the entire population. That’s a full eight years sooner than previously projected, and that’s if the present trend doesn’t increase! In 1960, whites made up 85% of the US population. The largest increase will be the largely Catholic and Spanish speaking Hispanic population, which will grow from 15% today to 30% by 2050! The population among blacks will see only a very moderate increase to between 13% and 15% if any at all (Hispanics have replaced blacks as the largest minority several years ago). Asians, who are predominately Buddhists, will increase in population from the current 5% to around 9%-10%. This will be seen more dramatically on the West Coast, especially in Oregon and Washington.

Here’s another statistic I found intriguing. In 2005, one in eight Americans was foreign born. By 2050, that number will increase to one in five. New immigrants, their children, and their grandchildren will account for a projected 85% of the increase in population between now and 2050.

Naturally, my first thought when I read this was how to restrict or somehow curtail immigration (especially illegal immigration), so you can imagine my surprise when I read the next set of new statistics released from the Center of Immigration Studies. They reported that gap between working Americans and non-working Americans (children and seniors) will continue to widen as baby boomers begin to retire and exist the stage. Currently there are 59 “dependents” for every 100 workers. By 2050, that number will increase to 72 “dependents” for every 100 workers---most of whom will be new immigrants. So, to decrease immigrant population ultimately shifts more of the taxable burden on fewer people (I admit to having chilling visions of “Logan’s Run” at this point folks).

What about multiracial changes in the population? According to the Census Bureau, between 1960 and 1990, black-white marriages increased from 1.7% to 6%. In 1993, 9% of marriages involving black men were to white women. Black women are marrying White males at a rapidly increasing rate; perhaps as high as 10% of marriages involving black women. But interracial marriages aren’t limited to blacks and whites. In Washington for example, the most common mixed race combination is between American Indian and White (47,000), followed by Asian and white (45,000) according to the 2000 Census numbers. The same Census number revealed that 2.4% of the population (that was 7 million people) regarded themselves as multiracial.

Religion too seems to be changing. As I pointed out earlier, Hispanics, who traditionally have been Catholic, is the fastest growing population. However, that appears to be changing as well. While many, if not most, have remained faithful to their religion, increasing Hispanics are turning to Protestantism, and especially to Southern Baptist which has developed a concerted effort to convert Hispanics to their brand of Christianity. To counter this trend, the Catholic Church is offering Mass and other activities in Spanish.

Apparently the Baptist strategy is working as evangelical churches account for 26.3 of the adult population out of a total of 51% of US adults identifying themselves as Protestant. Catholicism has suffered the greatest loss in membership. While one in three Americans (about 31%) were raised Catholic, only 24% remain Catholic. The biggest influx of non-Christians has been Islam, Hindu, and Buddhist. Now here’s something I found interesting as well. Which religious group tends to have the most children? Well, its Mormons and Moslems.

So, what does this all mean? Well, as I stated at the outset, we all know the complexion of America is changing. Interracial marriages and their subsequent children will increase. The average American by 2050 will likely look, behave, believe, and speak very different than the average American today. They are more likely to be of mixed racial heritage. They are more likely to speak multiple languages (especially Spanish) and at home in different cultures as their friends and business associates will be from different cultures. When it comes to religion, they are just as likely to experiment as they are to try on different jean to see which one fits the best (as an aside, the fastest growing “religion” in America is Wicca followed by individuals who regard themselves as “spiritual but non-religious” ).

This multiculturalism will have a tremendous affect on the political psyche of the nation. In some ways, there may be a backlash by demanding that English become our national language. There may be a demand for an increase in technology in order to lessen no only our dependence on other countries, but also on foreign born workers, especially those here illegally. Technology will also be necessary just to offset the ratio of working and non-working Americans.

Politically America may look very different too. If the Democrats are successful, there we will have our first mixed raced president (despite the rhetoric of a few, Obama isn’t “black”. His father was black while his mother was white). However, Americans are ever increasingly tired of both political parties. The fastest political segment of the population are Independents, The Gallup reported on August 2, 2007, that 37% of eligible voters considered themselves independent while 32% considered themselves Democrat and 29% as Republicans. Indeed, it appears that if the multi-everything trend continues, Democrats may have the best advantage given their history of co-opting minorities. However, don’t be surprised to see that as only a short term advantage since Americas as clearly looking to opt out of the current corporate controlled dual political party monopolies. Time is clearly on the side of third parties (which are growing like mushrooms) and independent candidates.

Let’s also not overlook the distribution of tax based public resources. Historically, since the advent of President Johnson’s “War on Poverty”, the bulk of public assistance has been directed toward blacks, who tended to fall at or near the poverty level. But with Hispanics now replacing black as the largest minority, much of that (diminishing) money will be directed towards them. Secondly, with the Asian population rapidly increasing, blacks may find themselves competing with Asians for any crumbs remaining. That of itself could increase racial tensions. Speaking of tax based assistance, with the huge number of rapidly aging population, combined with fewer workers, is there anyway we can avoid some form of national healthcare? Many businesses can’t attract quality employees because they can’t offer them even basic healthcare coverage, and the cost of healthcare only continues to rise. Whoever is elected president will have to quickly come to terms with this issue.

Change can fought against or embraced, but it can’t be stopped. While no nation lasts forever, the nation which can best adapt to change is the one best able to endure. That applies to America as much as did to ancient Egypt, Greece, or Rome. Those who fail to grasp this lesson will, as Trotsky famously quipped, will be consigned to the “dustbin of history”.

“So near to the truth, yet so far.” That’s the feeling I came away with after watching Bob Woodruff’s recent China Inside Out documentary for ABC news. It’s regrettable that a journalist of such a high caliber as Woodruff can get so close to a story and not really see it -- while helping to perpetuate a number of dangerous myths about China.

Woodruff’s approach seemed very promising at first. He went to four different continents and countries in order to assess the global impacts of China, the countries being Angola, Brazil, Cambodia, and the United States.

The Angolan segment highlighted China’s economic development model in Africa. The myth perpetrated in this segment is that the development has actually provided a net benefit to the people of Africa.

In fact, the real truth China is practicing a very sophisticated 21st century version of imperialism in which China loans African countries billions of dollars in exchange for encumbering natural resources. These resources range from oil and natural gas to copper, cobalt, and titanium. As part of its debt encumbrance strategy, China gets to reduce its unemployment rate by using a large Chinese construction workforce to actually do the work – rather than relying so much on the native population.

In this segment, Woodruff makes repeated references to corruption. However, in a glaring omission, he fails to make explicit just how much of the billions in Chinese aid is actually siphoned off into offshore bank accounts held by the African elites. Nor does Woodruff highlight the intense poverty in the countriesChina is supposed to be “benefiting” -- other than offering a few images of slums.

That said, the absolute worst omission of the African segment is Woodruff’s failure to mention the Darfur genocide in the Sudan. Instead, the only thing we get is a passing reference to Chinese aid to the Sudan in exchange for oil. In fact,China regularly trades its veto power at the UN for African resources in exchange for shielding African despots from UN interventions.

What made Woodruff’s omission all the more galling is that Woodruff did an extensive interview with China’s United Nations Ambassador Wang Guangya. This is the same reprehensible “diplomat” who has repeatedly blocked UN action on Darfur. (Wang also has blocked action following the sham Zimbabwe election and the attempts of the West to sanction Iran for its nuclear development). The failure to confront Wang on the Darfur question was tantamount to appeasement -- or, far worse, simple ignorance.

Woodruff’s omissions were equally in evidence in his Brazil segment. The theme Woodruff drew here is that China’s increasing consumption for soybeans is leading to deforestation of the Amazon and potential environmental problems. The biggest problems with this segment were a lack of visual imagery to portray the destruction of the Amazon, and the lack of science and statistics to explain how deforestation in the Amazon is likely to affect the global environment and crop production.

In fact, most of the Amazon’s deforestation occurs during the dry season in an orchestrated slash and burn campaign that fouls the skies throughout South America. Showing that massive environmental carnage -- instead of a few big trees being felled -- would have made for a far stronger presentation. Missing, too, was any good explanation of why we should care about the Amazon. In fact, theAmazon River basin and its rainforest are absolutely critical to the global ecology because they are considered to be the "Lungs of our Planet." By recycling carbon dioxide, the rainforest in particular provides more than 20 percent of the world’s oxygen.

Already, more than 20% of the Amazon rainforest has been destroyed while the World Wildlife Fund warns that more than half of the forest will be gone by 2030. According to many scientists, this destruction of the rainforest has the potential to create severe drought conditions not just in South America but also as far north as the American and Canadian farm belts. The result may well be a global food crisis -- high irony indeed given that the destruction of the Amazon rain forest is occurring in the name of increased food production.

Turning to the third segment on Cambodia, Woodruff does a good job tagging the Chinese with at least some responsibility for the Khmer Rouge genocide of millions. Missing in this segment, however, was any insight into the real reason why China is setting up so many sweat shops in Cambodia. Too bad Woodruff didn’t get his cameras into some of these sweat shops to expose the slave labor conditions!

My other big beef with the Cambodian segment was the failure of Woodruff to mention how China is using its upstream positioning on the Mekong River to dam that river with bullying impunity. China’s dam-happy Mekong River design will eventually include 15 mega-dams. These mega-dams are likely to create economic and environmental effects that are vast and far-ranging -- and Cambodiais at the front lines of this onslaught.

To understand the problem, consider the impacts of China’s dams on one of the world’s most fascinating ecological treasures, the legendary Lake Tonle Sap in Cambodia. For much of the year, the lake is only a yard deep with a footprint of only a bit more than 1,000 square miles. During the rainy season, however, flow from the Mekong River helps deepen the lake to roughly 30 feet and increases the area of the lake more than five-fold. This turns Lake Tonle Sap into one of the best breeding grounds for fish in the world.

The obvious problem facing the Tonle Sap is that the China’s mega-dams are evening out the flow of water and thereby preventing the world’s most fertile natural fishery from realizing its full depth and breadth in the critical fish breeding season. Already, fish catches have declined dramatically. This is already having a significant negative effect on Cambodia’s fishing economy.

Woodruff clearly saved the worst for last in his discussion of the impacts of Chinaon the American economy. He leads off the segment by helping to perpetuate the myth that China’s emergence as the world’s factory floor is the result of cheap, hard-working labor. (The mouthpiece here is Evan Osnos, Beijing Bureau Chief for the Chicago Tribune -- an otherwise cogent voice.)

In fact, my research has clearly shown that cheap labor is only a small part of the China puzzle. Much of China’s advantage in world markets comes from five unfair mercantilist trade practices that include a complex web of illegal export subsidies, blatant currency manipulation, counterfeiting and piracy that lowers production costs, and lax environmental and health and safety standards that likewise lower production costs.

That China blatantly manipulates its currency seems to be totally lost on both Woodruff and the seemingly clueless Fareed Zakaria. Indeed, it is Zakaria who helps perpetuate the myth that the Chinese are more frugal savers than American consumers and that’s why China helps the U.S. with its debt by buying U.S.treasury bills.

Note to Woodruff and Zakaria: The purchase of U.S. treasury bills is an integral part of the currency manipulation process. To maintain China’s fixed peg to the dollar and keep the yuan grossly undervalued, China must recycle dollars back into the U.S. Of course, individual Chinese citizens have no say in this matter; rather they are merely press-ganged into their frugality by China’s central bank -- which wants to keep exports to the U.S. cheap and imports into China dear. (It’s no accident the U.S. trade deficit regularly hits record highs.)

The failure of Zakaria to understand this currency manipulation process (and the broader role of unfair trade practices in China’s grab of American markets) makes it perfectly understandable why Zakaria ignorantly advises that the U.S. has only two options with China: “either ride the wave or drown in it.” In fact, what theU.S. Government should be doing to prevent the loss of American jobs is cracking down on China’s unfair trade practices. Leveling the playing field would go a long way towards bringing jobs back to the U.S.

On that note, it is useful to point out perhaps the biggest myth of the documentary – one perpetuated by none other than Mayor Michael Bloomberg of New York. His Honor piously insists that “the jobs that [China] is creating are low-priced jobs” and “that’s not the kind of jobs we want for our citizens.”

Note to the Mayor: While you’ve apparently been sleeping, China has moved steadily up and across the value chain into everything from autos and biopharma to commercial aircraft. It’s not just about cheap toys and sneakers anymore.

My bottom line is that I would love to see an in-depth, fair and balanced critical look at the economic, environmental, military, political, and social impacts of China on rest of the world. All that we have gotten so far from TV is a bunch of puff pieces that miss many of the major points and keep perpetuate a set of very dangerous myths.

Author BioPeter Navarro a business professor at the University of California-Irvine, is the author of the best- selling investment book If It's Raining in Brazil, Buy Starbucks and the path-breaking management book, The Well-Timed Strategy. Professor Navarro is a widely sought after and gifted public speaker and a regular CNBC contributor. Prior to joining CNBC, he appeared frequently on Bloomberg TV, CNN, and NPR, as well as on all three major network news shows. He has testified before Congress and the U.S.-China Commission and his work has appeared in publications ranging from Business Week, the L.A. Times, and New York Times to the Wall Street Journal, Washington Post, and Harvard Business Review.
www.peternavarro.com
www.comingchinawars.com

Poll Results

I asked if you thought business or labor bosses had a right to take money from your paycheck or dues and donate to candidates or political parties without your approval. 92% said no. To the other 8%, repeat after me, “I will think for myself”.

Book Review

The energy crisis is upon us and shows no signs of long term relief. Face it, $3.00 a gallon gas will only exist in stories we tell our children and grandchildren. The question of how we went from abundance to bust is complex. Often we’re just as much to blame as the oil companies and OPEC. No one explains this better than Jay Hakes, the former head of the US Department of Energy’s Energy Information Administration. Mr. Hakes has written a highly readable book entitled “A Declaration of Energy Independence” which outlines not only how we got were we are but perhaps more importantly, what to do about it. If you’re looking for answers about what we can do about the energy crisis, start with this book.